UK Analysis: Aug Trade Gap Widens; Set To Weigh on Q3 GDP>

-UK August Trade Gap Stg5.626bn vs Stg4.236bn in July

-UK August Goods Trade Gap Stg14.245bn vs Stg12.829bn in July

By Laurie Laird and Jamie Satchithanantham

     London (MNI) - The UK trade gap widened sharply in August, courtesy 

of a large increase in goods imports, leaving net trade poised to exert 

a significant negative influence on gross domestic product in the third 

quarter. 

     Over the month of August, the total trade gap rose to Stg5.626 

billion, the largest shortfall since September of 2016, from a revised 

Stg4.236 billion in July, compared to the MNI median forecast of a 

Stg2.8 billion shortfall. 

     Total exports rose by 0.6% to Stg50.153 billion in August, while 

imports jumped by 3.2% to Stg55.779 billion. 

     The deficit in goods widened to Stg14.245 in August, from a revised 

Stg12.829 billion gap in July, compared to the MNI median forecast of 

Stg11.5 billion. 

     Exports of goods rose by 1.5% to Stg28.155 billion in August, while 

imports surged by 4.5% to Stg42.400 billion. Chemicals, manufacturing 

materials and textiles were cited as the main drivers of goods imports 

in August.   

     That means that net trade must hit a surplus of Stg3.4 billion in 

September to leave the third quarter deficit on par with the shortfall 

of the second quarter. Net trade has not recorded as large a surplus 

since monthly trade data began in 1997, according to a National 

Statistics official. 

     Hopes that the sharp fall in sterling might boost exports in the 

wake of the Brexit vote have yet to be realised. Over the first eight 

months of 2017, exports of goods have increased by 13.4% compared with 

the same period a year earlier, while imports rose by almost as much, 

increasing by 11.4%. Those data are not adjusted for price changes. 

     The trade gap in goods with the 27 other nations of the European 

Union rose to Stg22.695 billion in August from Stg21.447 billion in 

July. 

     The non-EU trade gap widened to Stg5.835 billion in August, from 

Stg5.345 billion in the previous month. 

-London bureau: 44 (0) 203 865 3812; email: ukeditorial@marketnews.com

[TOPICS: M$B$$$,MABDS$]